Correlation Between Wuxi Chemical and Western Superconducting
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By analyzing existing cross correlation between Wuxi Chemical Equipment and Western Superconducting Tech, you can compare the effects of market volatilities on Wuxi Chemical and Western Superconducting and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Wuxi Chemical with a short position of Western Superconducting. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wuxi Chemical and Western Superconducting.
Diversification Opportunities for Wuxi Chemical and Western Superconducting
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Wuxi and Western is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Wuxi Chemical Equipment and Western Superconducting Tech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Western Superconducting and Wuxi Chemical is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Wuxi Chemical Equipment are associated (or correlated) with Western Superconducting. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Western Superconducting has no effect on the direction of Wuxi Chemical i.e., Wuxi Chemical and Western Superconducting go up and down completely randomly.
Pair Corralation between Wuxi Chemical and Western Superconducting
Assuming the 90 days trading horizon Wuxi Chemical Equipment is expected to generate 0.83 times more return on investment than Western Superconducting. However, Wuxi Chemical Equipment is 1.21 times less risky than Western Superconducting. It trades about 0.14 of its potential returns per unit of risk. Western Superconducting Tech is currently generating about -0.19 per unit of risk. If you would invest 3,413 in Wuxi Chemical Equipment on September 5, 2024 and sell it today you would earn a total of 226.00 from holding Wuxi Chemical Equipment or generate 6.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wuxi Chemical Equipment vs. Western Superconducting Tech
Performance |
| Timeline |
| Wuxi Chemical Equipment |
| Western Superconducting |
Wuxi Chemical and Western Superconducting Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wuxi Chemical and Western Superconducting
The main advantage of trading using opposite Wuxi Chemical and Western Superconducting positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wuxi Chemical position performs unexpectedly, Western Superconducting can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Western Superconducting will offset losses from the drop in Western Superconducting's long position.| Wuxi Chemical vs. Ping An Insurance | Wuxi Chemical vs. Panda Financial Holding | Wuxi Chemical vs. Unisplendour Corp | Wuxi Chemical vs. Shenzhen SDG Information |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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